Business, Management and Accounting
4 years ago

Composite Indicator Outperforms Market Ratios in Forecasting Stock Prices!

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International Journal of Contemporary Accounting
IS STOCK PRICES REFLECTED IN MARKET RATIOS?
Tan Kwang En

Paper Summary

Stock prices can be forecasted using fundamental or technical analysis. This study focuses on using technical analysis, specifically financial ratios, to predict stock prices. By comparing a composite indicator with other market ratios like price to sales, price to book value, price to earnings per share, and price to operating cash flow, it was found that the composite indicator is the most effective method for forecasting stock prices.

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